Kyrgyzstan taking loan from China for railway with Uzbekistan

Bishkek will receive a $304.5 million concessional loan from China to finance Kyrgyzstan’s share in the China-Kyrgyzstan-Uzbekistan railway project. The document was discussed on June 23, at a meeting of the Committee on International Affairs, Defense, Security and Migration of the Jogorku Kenesh of Kyrgyzstan.

According to Deputy Minister of Transport and Communications Almaz Turgunboyev, Kyrgyzstan plans to attract a concessional loan worth 2.074 billion yuan, or about $304.5 million, to finance 50% of the Kyrgyz side’s share in the joint project to build the new railway.

Kyrgyzstan’s share amounts to 24.5%, or around $609 million. Half of this amount is expected to be provided from state funds, while the remaining half will be covered through borrowed funds.

The loan will be provided for 25 years, including a five-year grace period. The interest rate will be 1.5% per year, while the grant element of the loan, according to the Ministry of Finance, will reach 35.46%.

The funds will be used only to finance the Kyrgyz shareholder’s capital contributions to the joint railway company and to pay for the construction of the main line.

The initiators of the agreement urged the committee to approve the deal in the third reading at once. However, committee chair Elvira Surabaldiyeva said the committee was considering the bill today in the second-reading mode.

“On June 25, we will hold an extraordinary meeting of the committee, where we are ready to consider this agreement in the third-reading mode. After that, it can be submitted to the plenary session. We understand its importance, but we cannot violate the rules of the Jogorku Kenesh,” she added.

For reference, the China-Kyrgyzstan-Uzbekistan railway is considered one of the largest infrastructure projects in Central Asia. The total cost of the project is estimated at $4.7 billion, of which about $2.3 billion will be provided by China to the joint project company in the form of a 35-year loan. The remaining funds must be contributed to the charter capital by the company’s founders: China with 51%, and Kyrgyzstan and Uzbekistan with 24.5% each.

According to Kyrgyzstan’s Ministry of Finance, as of January 31, 2026, Kyrgyzstan’s debt to the Export-Import Bank of China stood at around $1.5 billion, making it the republic’s largest external creditor.